Contrary to the challenging period in the real estate market following a successful 2022, managed savings in real estate through real estate funds and REITs are growing. This growth is attributed to a preference for quality, involving targeted divestitures, acquisitions, and streamlining. Italy, along with the rest of Europe, is thriving.
According to the 2023 update on “Real Estate Funds in Italy and Abroad,” by Scenari Immobiliari in collaboration with Studio Casadei, Italian real estate funds reached a portfolio value of 127 billion euros in 2023 (a 3.2% increase from 2022), with further growth expected in 2024, reaching 132 billion euros (+3.9%).
“For many years, fund managers have focused on product quality, ensuring that values and rents remain stable even in challenging years,” explained Mario Breglia, President of Scenari Immobiliari. He added, “The occupancy rate of properties is very high. The smart working phenomenon has not changed the choices of large companies in the tertiary sector. On the contrary, it is creating new demand for functional spaces more suited to the needs of workers. As a result, the vacancy rate in new tertiary spaces is below 2%, compared to 15% for less suitable properties.”
Forecast for Italian Real Estate Funds in 2024
As of December 31, 2022, Italy had 615 active real estate funds, investing in 10,400 assets (ranging from entire buildings to residential units, if collectively included in the fund), covering a total area of 39.2 million square meters. By 2023, the number had increased to 630.
What about the coming year? According to Scenari Immobiliari’s forecasts, the growth trajectory of Italian funds will continue in 2024. “We anticipate an increase in Net Asset Value (NAV) and assets by 2.7% and 3.9%, respectively, estimating the fund’s assets in our country to reach 132 billion euros. We project an increase of twenty units, totaling 650,” commented Francesca Zirnstein, General Manager of Scenari Immobiliari.
